Our research project will be looking at two specific questions: why consumers choose a specific insurance company, and why they stay with that company. As major insurance companies such as AllState, State Farm, Geico, and Progressive battle for market share, it is important to learn and understand the consumers’ thought process when making insurance decisions. In 2007 alone, $1.7 billion was spent on auto-insurance advertising. The top four advertisers (AllState, State Farm, Geico, and Progressive) accounted for 73% of the total auto-insurance advertising budget (Dow Jones).
Our general research objective will be to uncover more information about consumers’ decisions to choose and keep a company. Some problems we will attempt to address include; what qualities/characteristics consumers look for when choosing an insurance company, how trust is important in the insurance exchange, why some consumers view excessive insurance advertising and marketing tactics as burdensome and annoying, and why insurance companies have the problem of low loyalty rates and high turnover among customers. Literature Review
According to Insurance Networking News, there is a significant gap between what consumers want from their insurers and what they feel they are receiving. Accenture surveyed 7,000 people from 13 countries. The majority (84%) of respondents said they are satisfied with their insurance provider but there is a definite expectation gap in customer service issues.
62% of respondents said it was very important for their insurance provider to have clear and easy to understand content on their policies, but only 27% of respondents said they were satisfied with their insurers’ attempts to do so. According to Edwin VanderOuderaa, global managing director of Accenture’s Analytics group for financial services: “This gap suggests that consumers have low expectations rather than they are delighted with the experience they receive.”
The survey also...